The Company Law Board on Wednesday heard a petition seeking appointment of an independent chairman to run Birla Corporation following the death of R S Lodha.
In its petition, Rameshwara Jute Mills, an MP Birla group company, has prayed that the board of directors of the Birla Corporation and other M P Birla group companies should be superseded by independent people, as after the death of R S Lodha, there was no one to represent the company.
Opposing it, the Lodha camp submitted before the board that the petition was not maintainable and that there was no need to appoint any chairman of the group.
The Lodha camp's argument was that only independent directors were empowered to appoint chairman.
They further stated that as per the Articles of the Association the company, in the absence of the chairman (after Lodha's demise), directors could appoint a chairperson.
"Respondent 25 (Rameshwara Jute Mills) could not ask for such injunction. Parties must have interest and basis for such relief, as far as the company's corporate interest is concerned.
"What is the doubt...The remaining directors would appoint Harshwardhan Lodha as chairman. The prayer says that no chairman should be appointed by board. How could such a petition be filed?," asked Lodha's counsel.
"It is just to harass and embarrass Lodha family, so that his son should not come to hold the chairmanship," he submitted.
The matter has been posted for hearing now on December 8.
